itbuy and Newton, both based in Canada, have imposed a 30,000 Canadian dollar yearly "buy limit" for "restricted coins" for their Ontario users as a way to "protect consumers" amid tightened regulations.

Newton, a Toronto-based cryptocurrency exchange, announced its new changes after working to obtain registration with the Ontario Securities Commission and securities regulatory authorities in other Canadian provinces and territories, noting in a Tuesday post.

"These changes are intended to protect crypto investors such as yourself, as well as to make investors aware of the risks associated with investing in crypto assets."

The new changes will subject Ontario-based crypto traders on Newton and other Canadian crypto platforms to an annual 30,000 CAD "net buy limit" on all cryptocurrency coins, excluding Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), and Litecoin (LTC).

The platform said that if a trader purchased and then sold a restricted coin, the amount sold would be deducted from the limit. After the first purchase of restrained coins, the limit resets every 12 months.

The purchase restrictions come as the cryptocurrency platform declared on Wednesday that it has legally registered as a "restricted dealer" in the province of Ontario, implying that they are now susceptible to the Ontario Securities Commission's regulations (OSC).

Other adjustments aimed at safeguarding consumers include a "trading questionnaire." The exchange must obtain information from users about their previous knowledge and experience of crypto investing, financial situation, and risk tolerance. It must be completed for the account to be funded and trading on the platform to continue.

The cryptocurrency exchange will also notify traders if their portfolio experiences a loss level that they demonstrated in the questionnaire.

Bitbuy, another Canadian cryptocurrency exchange, revealed similar purchase limits earlier this year, mentioning that strict limits apply to users in Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, the Northwest Territories, Nunavut, and Yukon.

Bitbuy demands traders to accomplish a questionnaire to establish whether they are Retail Investors, Eligible Investors, or Sophisticated Investors. Whereas Retail Investors' purchase limit remains at 30,000 CAD, Eligible Investors' purchase limit is increased to 100,000 CAD, and Accredited Investors have no purchase limit.

The province of Ontario alone accounts for nearly 40% of the Canadian population, with Toronto serving as the major metropolitan center.

Newton pointed out that each province and territory in Canada has its own securities regulatory authority, which is referred to as the Canadian Securities Administrators (CSA).

Consumer safety isn't the only thing on the minds of Canadian regulators. The Canadian federal government declared in April 2021 that it would conduct a legislative review of the financial sector, with a particular emphasis on improving digital currency security and stability and establishing a central bank digital currency (CBDC).

Newton, which bills itself as "Canada's trust low-cost crypto trading platform," was founded in 2018 and is now one of Canada's most popular exchanges, with 100,000 users surpassing in February 2021.

Aug 18, 2022
Crypto News

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